Market Sizing North America
Intelligent & Integrated Technologies
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Market Sizing North America
Intelligent & Integrated Technologies
Overview for CABA
IIBC at AHR2010
Jan. 25, 2010
Market Sizing North America
Intelligent & Integrated Technologies
Level 1 sponsors
Level 2 sponsors
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Experienced Project Team
Andrew Giles, MA
General Manager
BSRIA - World Market
Intelligence (WMI)
Jeremy Towler, BBA, HTEC,
dipl. Oek. Senior Manager
Intelligent Building Technology
Lone Hansen
Senior Manager
I.T. Cabling and
Associated Technologies
Gambi Chiang, MSc, BEng, MCIM,
Charter Marketer
Senior Manager Special Projects
Sukant Rout, BEng(Telecom), MBA
Senior Market Research Consultant:
Intelligent Building Controls / IT
Cabling & Associated Technologies
Ianire Cobeaga, MBA
Market Research Consultant
Intelligent Building Technology
Allan McHale, CEng, MIMechE,
MIst Energy, MBIM.
Independent Consultant
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Study Objectives
Purpose
 Detailed assessment of current and future markets around intelligence in non-domestic
buildings in North America
 Quantitative and qualitative market assessment, segmentation, competitor analysis,
routes to market
 Size markets for principle applications plus integrated and IT-converged solutions
Scope
1.
2.
3.
4.
5.
IT Convergence
Environmental Controls
Lighting Controls
Security Systems
Fire Detection Systems
Timetable

June – Dec 2009
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Key Findings
Environmental (HVAC) Building Controls
 The market will compete in applying BAS to tackle climate change issues
 Companies need to obtain and disseminate both controls and IT knowledge
Lighting Controls
 Huge savings and market potential
 Consolidation to provide total lighting solutions and more integration
 LED lighting is a growing market but controls required for better efficiency
Security Systems
 CCTV / Video surveillance setting the pace, followed by access control
 Strong movement towards IP systems and integration of security systems
Fire Detection and Alarm
 Robust, growing market, driven (and constrained) by codes & regulations
 Demand for better evacuation solutions will drive integration of nascent mass
notification / voice evacuation market
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$20 Billion Systems* Market 2009
Intruder Alarm
Lighting Control
$2,053
$906
11%
5%
BMS
$5,733
29%
Access Control
$2,535
13%
Fire Detection &
Alarm
$2,751
14%
CCTV/Video
$5,475
28%
$8.5 Billion Market for Products* (incl. cable & cabinets) 2009
*
*
Systems = Product + Value Add (Engineering, Commissioning, Installation)
excluding maintenance
Products = Hardware, Software, Cable and Cabinets
at first point of distribution prices
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End-user Sectors
 Top vertical markets:
Education
13%
Offices
12%
Central / Local Government
11%
Health
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IBC Markets will Rebound
Construction Output
Growth Rate (%)
1,800,000




Depressed economy, lack
of credit, increasing
building vacancies
Fall in new construction,
delayed refurbishment
and retrofit
However, IBC* markets
have outperformed
Economic stimulus will
help boost demand –
particularly public sector
IBC* markets expected to
return to growth late
2010/early 2011
1,600,000
10%
1,400,000
10%
9%
1,200,000
6%
6%
1,000,000
5%
4%
800,000
5% 5%
0%
600,000
400,000
US$ Bn.

15%
USA
13%
200,000
Construction
Output
-7%
Source: Economist/ US Census Bureau
350,000 -
-10%
7.0%
300,000
6.0%
250,000
5.0%
4.2% 4.2%
200,000
4.0%
3.1%
150,000
2.3%
100,000
3.0%
2.6%
2.3%
2.0%
1.5%
1.0%
Source: StatCan
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6.5%
50,000
* Intelligent Building Controls
-5%
Growth Rate
0.0%
2009f 2010f 2011f 2012f 2013f 2014f 2015f 2016f 2017f
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Definition Convergence
Convergence is to bring together autonomous
systems onto a common communication
platform within the business enterprise and
create a single unified solution
Network = Ethernet Cat 5/5e/6 and/or fibre
IT network/
backbone
BMS structure
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Definition integration
Integration is to add value by
joining or linking different
building services products
However nearly all integrated
solutions are also converged at
least at management level
- many also at control level
Service layer
(IP provider)
IT-Convergence
IT-Networks
Management level
(Mostly IP)
Automation/control layer
(IP/BACnet/LON/proprietary)
Integration
Automation/control layer
(IP/BACnet/LON/proprietary)
Technical Infrastructures
(HVAC/Lighting/Security/Fire etc.).
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Total system market $20 billion
8%
converged
(IT) only
34%
integrated
and
converged
BMS
21% on a separate
BMS infrastructure
• 56% = stand-alone
• 44% = integrated
and/or converged
2%
integrated
only
IT
13% on the IT network/backbone
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Stand-alone vs. integration/convergence by
product area, US$ million, 2009
7,000
6,000
5,000
4,000
3,000
2,000
1,000
0
BMS
Lighting
(controls)
Stand alone
CCTV
Integration
Access
control
Convergence (IT)
Intrusion
Fire and
safety
Convergence (BMS)
 Stand alone is high for lighting, intrusion and fire (~90%)
 IT convergence only – 25% for CCTV, 6% access
 Integration and convergence high for BMS (54%) and access (45%)
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Forecast 2009 – 2013, % split by stand-alone
vs. integrated and converged
100%
90%
80%
Stand alone
70%
60%
50%
Integrated only
40%
- Convergence IT
30%
20%
- Converged BMS
10%
0%
2009
2010
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2012
2013
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Trends
 Intelligent buildings not a new topic, but new attention to energy usage
and building performance
 Many corporations increasingly take centralised decisions and need
more and better information
 Government wants to reduce CO2 emissions and energy consumption
 Technology advancements are key drivers e.g. IP, wireless, PoE
 IT barriers (lack of bandwidth, security) solved!
 Scope and expertise increasing, integration/convergence of products
 A number of companies can now take on the role of Master SI (the
outcome however still depending on the person in charge)
 Data centres are becoming more intelligent
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Smart Grid - Definition
 An intelligent electricity system that connects all supply grid
(utilities) and demand elements (end-users) through an
intelligent communication system
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Barriers
 Resistance from FM and from IT to converge (stick to
own areas of expertise and competence)
 Lack of training and skills
 Construction process uses traditional route with main
contractor and sub-contractors
 Long-term outsourcing contracts
 Historic objections relating to the IT infrastructure e.g.
security, downtime, bandwidth
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2 Main Drivers of Convergence
1
Energy and building
performance
2
Security
 Energy savings and
efficiency
 Higher level of security
(physical and IT security
converged)
 Improve building
performance (better
decisions)
 Efficient data sharing
 Reduce maintenance costs
 Increase the value of the
building/rental revenues
 Remote access
 Improving storage
 Access cards a requirement
 Link data sharing between
departments
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Who is driving convergence?
BMS
IT
Security
Large projects 90%-100% converged at
management level (Ethernet)
IT convergence not perceived a benefit by many
BMS suppliers
IT suppliers keen to drive IT convergence
- Cisco: Mediator and hardware
- IBM: software, consultancy and Master SI
- Oracle, HP, Plexus etc. offer software/advice
- Integrated in BMS offering
- Driven by IT (hardw, cabling suppliers/channel)
- Security SI/installers high end drive it
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Who is driving convergence?
Energy
rating
schemes
Most converged buildings are in US
LEED silver/gold/platinum
Political/
economic
factors
- International pressure to reduce CO2
- Government funded projects
- Buildings consume 70% of electricity
and 40% of primary energy
End-users
- Pressure from society and clients to
have a green profile
- Reduce energy costs
- Improve building performance and
management
A driver for convergence, but not necessarily IT convergence
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The Main Systems Integrators
CISCO
IBM
IBC(e)
IBC(l)
IBC(s)
IBC(f)
Honeywell
Honeywell
Diebold
Honeywell
Johnson Controls
Johnson Controls
Convergint
Siemens
Schneider Electric
Schneider Electric
Honeywell
Tyco
Siemens
Siemens
Johnson Controls
UTC? (GE Security)
UTC
UTC
Niscayah
Siemens
Schneider Electric
Tyco
UTC
Oracle
HP
Others, Accenture,
Plexus, Wipro etc.
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Building Controls Product Trends
Sensor




Controller
 42% are web-enabled controllers, mainly automation
level controllers
 End-users demand for standard protocol controllers
 Multi-protocol controllers
Wireless




Better automatic control require more sensors
Demand for smart sensor
Demand in CO2 sensor
Demand for all-in-one sensor
Still a very small market, mainly for sensors, < 5%
Industry sees the potential in room solution
Standards: Zigbee, 805.12.4, 6LoWPAN, EnOcean
Key issues: energy demand, data transmission
capacity
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Trends in the Installed Building Controls
System Market
 Growing demand for integration of various building
controls system to a centralized one
 Increased share of smaller scaled contract
 Reduced contract size due to OEM packaged supply
 BACnet will continue to challenge LON’s share
 Proprietary system will continue to diminish
 Penetration of LON in smart meters
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Development of Integrated Building
Management Systems (IBMS)
Integrate with sub-systems
Integrate with other systems
Integrate with other BAS
Integrate with other enterprises systems
Open Standards Enabling Convergence
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Development of IBMS




Integration with sub-systems is the norm
Centralized monitoring and control more common
Integrated systems are mostly IT converged
Share information to improve building and enterprise
performance
 Integrate for the purpose of energy saving
 Driven by end users and ROI is the critical factor
 Better recognition of the benefits of integration in:
– Banking, transportation, education, health, high-tech
manufacturing, life science, communication and data
centre sectors
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Number of Projects
How Quickly will Integration Grow?
Hurdles:
• Too much
customization
• Lack of standard
applications
• Ability to demonstrate
and convince the
clients on ROI
Time
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Key Market Drivers and Trends
Current drivers
1. Energy management
– More function to reduce energy consumption
– Data visualization software and enterprise dashboards
– Integrate smart meters
– Energy monitoring, reporting and analysis service
2. LEED and Energy Star Label
3. Energy Legislation and codes
4. Government stimulus
Long term driver
5. Smart grid development
– Monitor consumption and track min. and peaks
– Automatic demand response
– Demand modeling
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Key Market Drivers and Trends


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
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Energy saving applications
Open system
Integration and IT convergence
Increase in energy retrofit
Consolidation will continue
Compete in the knowledge in buildings and BAS
applications
 Controls contractors migrate to system integrators
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Lighting Controls Conclusions
 Huge potential for lighting controls in the North American market
 Integration of lighting controls with other building systems will
increase - lots of push from manufacturers and end users are
beginning to understand the returns
 The transition to skilled and trained people with knowledge and
understanding of energy management products will take time
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Lighting Controls Trends
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DOE will play major role in driving control (and LED) standards
Energy regulations through ASHRAE standard is big controls driver
Standard open communication protocols is growing trend - mostly driven by
integration with other systems
Integration and IP-Convergence growing but apart from HVAC adoption low
Consolidation – Acuity/Philips/Cooper Controls acquiring companies to
provide total lighting solutions
Wireless - ENOCEAN in commercial, Zigbee in residential
Dimming Ballasts ~10% of total ballasts market in North America
LED is growing market - still require controls for better efficiency
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Fire Detection/Alarm Market Penetration
50,000
North America
45,000
Western Europe 7
(EU(7))* Average
40,000
Netherlands
Belgium
Spain
GDP / Capita (US$)
35,000
Italy
United
Kingdom
Germany
France
30,000
25,000
20,000
15,000
10,000
5,000
0
1
2
3
4
5
6
* Belgium, France, Germany, Italy, Netherlands, Spain, United Kingdom 2008
estimates based on 2007 actual data
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Total IBC(f) System Sales / Capita (USD)
13
14
15
16
17
18
Sources: CIA World Factbook, BSRIA Proplan
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Fire Detection/Alarm Communications
and Web Enabling

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

Majority of fire systems sold with proprietary protocol
Some BACnet equipped panels but penetration marginal – using to
integrate fire panel with the HVAC system
Strict fire codes make fire system integration to non-fire systems rare
However, more end users insisting manufacturers make comms. protocol
details available to enable integration by independent integrators
IP being used to connect fire panels with mass notification systems
<10% of fire systems web-enabled (remote interrogation) but growing
Web-enabled examples include small commercial chains as cost
effective solution to manage buildings portfolio
Reticence towards IT-Convergence and limited installer knowledge
Consolidated supply side limits innovation
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Security Systems Product Sales
Forecast to 2013
Growth 2008-2009
5000
GAGR 2008-2013
Product sales
4500
-1.9%
4000
5.0%
USD million
3500
3000
CCTV / Video surveillance sales
2500
0%
6.7%
2000
1500
-3%
Access Control
3.7%
-5%
Intruder Alarm
2.0%
1000
500
0
2007
2008
2009
2010
2011
2012
2013
 Market opportunities reduced due macroeconomic situation
 2009 sales fall, recovering end of 2010
 Less feature rich products gain share in short term
 Performance will vary by type of sub-system
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Integration of Security Systems
 Increasing interest in holistic security
solutions
 20% of security systems sold in 2008
were integrated
 Open architecture platforms and
development of industry standards
will have a positive impact on sales
High
Low
Low
Low
 However, demonstrable benefits of
integration and return on investment
are essential
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The future
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

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Increase in energy saving applications and retrofit
More security solutions
Open systems, IP, integration, IT convergence
Compete on knowledge of buildings and applications
Controls contractors become system integrators and master SIs
Consolidation / Partnerships between best-in-class suppliers
IT companies augment their offering to include new applications
- Facility management, energy management, security…….
 There will be more solution providers
 Educate, disseminate, prove ROI
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End
Thank you